UK-EU Brexit Breakthrough

It appears negotiators have made a breakthrough in the ongoing discussions over how Brexit will unfold. Alex Barker and Mehreen Khan report for the FT:

“We were able to agree this morning…on a large part of what will make up an international agreement for the ordered withdrawal of the UK,” said Mr Barnier.

Under the time limited period, the UK will have to abide by all existing EU rules but will lose its say in the decision-making process.

The negotiators published a colour-coded draft text of Britain’s withdrawal agreement, showing areas of agreement and dispute. The two most difficult political issues – governance and the Northern Ireland border – were left in “white”, noting further negations were required.

The two sides were able to reach comprehensive agreements on a financial settlement and the rights of around 4m citizens affected by Brexit. While progress was made in other parts of the divorce treaty, disagreement remains over judicial cooperation, data protection and intellectual property.

Mr Barnier said he was confident the EU could agree on an “ambitious” framework for future UK-EU foreign and security policy during the transition period.

“The intention is to move as fast as possible as soon as on all aspects of the future relationship”, said Mr Barnier.

On Ireland, the UK has agreed to include a “legal” backstop that would keep Northern Ireland in key parts of the single market and the EU’s customs union.

“The backstop will apply unless, or until, another solution is found,” said Mr Barnier. Talks over the border will continue over the next weeks. Mr Davis said the legal language on the Irish backstop had to be “acceptable to both sides”. He said it was still the aim of the UK to achieve a future trade deal that was so deep and close that it would “not to require specific measures for Northern Ireland”.

The two sides have also reached “complete agreement” on citizens’ rights after Brexit and the UK’s financial settlement, Mr Barnier added.

“Citizens who arrive in the UK during the transition period will have the same rights as those arriving before the Brexit period”, said Mr Barnier.

However, the transition relies on a final agreement on the complete withdrawal agreement later this year. “It’s a good landing spot,” said one EU diplomat briefed on the terms.

EU’s Barnier Says U.K. Transition Deal and Large Part of Exit Treaty Agreed

Jeremy Jones, CFA

Jeremy Jones, CFA is the Director of Research at Young Research & Publishing Inc., and the Chief Investment Officer at Richard C. Young & Co., Ltd. Jeremy is a contributing editor of youngresearch.com.